Suncorp wealth management posts profit
Queensland-based banking and financial services group Suncorp has confirmed a 32.8 per cent decrease in profit for the half year to December 31, 2008, with strong results in its wealth management division offset by banking woes.
The group confirmed a consolidated net profit after tax of $258 million for the half year to December 21, 2008, compared to $383 million for the previous corresponding period.
The group has reported profit after tax in its wealth management division of $135 million, up 31 per cent when compared to the six months to December 31, 2007. Underlying profit for wealth management was $68 million. This includes not only the group’s funds management operations but also its life risk department. The group said the strong result was also supported by cost cutting initiatives put in place last year.
The contribution of the group’s banking division — which has been up for sale at certain times over recent months — decreased to $97 million from $397 million at the end of 2007, with the underlying profit being offset by high impairment charges. Impairment losses on loans and advances hit $355 million in the last six months of 2008 from a base of $16 million in the six months to December 2007.
The banking division's contribution before tax and impairment charges was $452 million, attributed to cost cutting among higher net interest charges, and representing an increase of 39 per cent.
Banking loans, advances and other receivables at December 31, 2008, were at $55.8 billion, only slightly lower than June 30, 2008, at $56 billion, with retail lending up by 2.7 per cent and business lending down by 2.2 per cent.
During the half year to December 31, 2008, the group raised wholesale funding totalling $2.3 billion that was guaranteed under the Government Deposit Guarantee.
The group will pay shareholders an interim dividend of 20 cents per share fully franked.
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